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Published:
Concho Resources Inc. Reports Third Quarter 2009 Financial and Operating Results and Provides 2010 Capital Budget Detail and Guidance
MIDLAND, Texas - (BUSINESS WIRE) - Concho Resources Inc. (NYSE: CXO) ("Concho" or the "Company" ) today
reported financial and operating results for the three and nine months
ended September 30, 2009 and provided 2010 capital budget detail and
guidance. Highlights for the three months ended September 30, 2009
include:
-
Production of 2.9 million barrels of oil equivalents ("MMBoe" ) for the
three months ended September 30, 2009, a 51% increase over the third
quarter of 2008 and a 5% increase over the second quarter of 2009
-
Third quarter net income of $19.8 million, or $0.23 per share; after
adjusting for certain non-cash items, adjusted net income (non-GAAP)
would have been $31.7 million, or $0.37 per diluted share, for the
third quarter of 20091
-
Third quarter EBITDAX of $133.8 million, up 10% from the same period
in 20082
1 The Company believes that this information may be useful to
investors who follow the practice of some industry analysts who make
adjustments to exclude certain non-cash items when calculating earnings
per share and cash flow from operating activities. For an explanation of
how the Company calculates and uses adjusted net income (non-GAAP) and
cash flow from operating activities adjusted for settlements received
(paid) on derivatives not designated as hedges (non-GAAP) and a
reconciliation of (i) net income (loss) (GAAP) to adjusted net income
(non-GAAP) and (ii) cash flow from operating activities (GAAP) to cash
flow from operating activities adjusted for settlements received (paid)
on derivatives not designated as hedges (non-GAAP), please see
"Supplemental non-GAAP financial measures" below.
2 For an explanation of how the Company calculates and uses
EBITDAX and a reconciliation of net income (loss) to EBITDAX, please see
"Supplemental non-GAAP financial measures" below.
Production for the third quarter of 2009 totaled 2.9 MMBoe (1.9 million
barrels of oil ("MMBbls" ) and 5.8 billion cubic feet of natural gas
("Bcf" ), an increase of 51% as compared to 1.9 MMBoe (1.2 MMBbls and 3.9
Bcf) produced in the third quarter of 2008. For the first nine months of
2009, production totaled 8.1 MMBoe (5.4 MMBbls and 16.1 Bcf),
representing a 70% increase over the 4.8 MMBoe (3.0 MMBbls and 10.4 Bcf)
produced in the first nine months of 2008. Pro forma for the Company's
July 2008 acquisition of Henry Petroleum LP and certain of its
affiliates, the third quarter of 2009 and first nine months of 2009
production increased 40% and 39%, respectively, over the comparable
periods of 2008.
Timothy A. Leach, Concho's Chairman, CEO and President commented, "The
Company's performance in this extremely volatile year demonstrates that
our business plan and assets can absorb the cycles of the oil and gas
business and grow despite challenging market conditions. In 2009, we
have significantly grown production within cash flow while lowering per
unit expenses. With increasing cash flow due to higher production levels
and rising commodity prices, we are well positioned to finish 2009 and
begin 2010 at a very high level of activity. The Company's 2010 capital
program includes the drilling of approximately 500 wells out of our
inventory of over 3,500 drilling locations. We plan to fund this budget
within cash flow; however, we will maintain the ability to scale
spending up or down depending on market conditions."
For the three months ended September 30, 2009, the Company reported net
income of $19.8 million, or $0.23 per diluted share, as compared to net
income of $141.9 million, or $1.72 per diluted share, for the three
months ended September 30, 2008. The Company's third quarter 2009
results were impacted by several non-cash items. These non-cash items,
recorded in the third quarter of 2009, included a $23.9 million non-cash
mark-to-market unrealized loss on commodity and interest rate
derivatives, a $1.1 million impairment of long-lived assets, and $0.2
million of leasehold abandonments. Excluding these items and their tax
impact (see paragraph below regarding third quarter 2009 tax rate),
third quarter of 2009 adjusted net income would have been $31.7 million,
or $0.37 per diluted share. Excluding similar non-cash items and their
tax impact from the third quarter of 2008, adjusted net income would
have been $44.8 million, or $0.54 per diluted share. For a description
of the use of adjusted net income (non-GAAP), see footnote 1 above. For
a reconciliation of net income (loss) (GAAP) to adjusted net income
(non-GAAP) for the three and nine month periods ended September 30, 2009
and 2008, please refer to the attached tables.
EBITDAX (defined as net income (loss), plus (1) exploration and
abandonments expense, (2) depreciation, depletion and amortization
expense, (3) accretion expense, (4) impairments of long-lived assets,
(5) non-cash stock-based compensation expense, (6) ineffective portion
of cash flow hedges and unrealized (gain) loss on derivatives not
designated as hedges, (7) interest expense, (8) bad debt expense and (9)
federal and state income taxes) increased to $133.8 million in the third
quarter of 2009, as compared to $122.1 million in the third quarter of
2008.
Operating revenues for the third quarter of 2009 decreased 10% when
compared to the third quarter of 2008, despite a 51% increase in
production. This decrease is attributable to the 45% decrease in the
Company's realized oil price and the 45% decrease in the Company's
realized natural gas price in the third quarter of 2009 compared to the
same period in 2008.
Oil and gas production expense for third quarter of 2009, including
taxes, totaled $25.4 million, or $8.86 per barrel of oil equivalent
("Boe" ), a 38% decrease per Boe over the third quarter of 2008. The oil
and gas production expense included the benefit of approximately $2.3
million ($0.79 per Boe) related to an overestimate of costs in the prior
periods. Including this adjustment, the decrease in oil and gas
production expense on a per unit basis was due to increased volumes from
the Company's successful drilling program in 2008 and 2009 and cost
reductions in services and supplies as a result of lower commodity
prices.
General and administrative expense ("G&A" ) for the quarter ended
September 30, 2009 totaled $12.7 million. Recurring cash G&A for the
quarter totaled $7.8 million, stock-based compensation (non-cash)
totaled $2.5 million, and the remaining $2.4 million was attributable to
amounts owed to certain employees which are to be paid over a two year
period that commenced on July 31, 2008 under the terms of the Henry
Petroleum purchase agreement.
For the three months ended September 30, 2009, the Company received cash
receipts for settlements on derivatives contracts not designated as
hedges of $16.1 million and the non-cash mark-to-market unrealized loss
for the derivatives contracts not designated as hedges was $23.9
million. This is compared to cash payments of $12.8 million on
derivatives contracts not designated as hedges and a $176.1 million
non-cash mark-to-market unrealized gain on contracts not designated as
hedges for the three months ended September 30, 2008. To better
understand the Company's derivatives positions and their impact on the
third quarter statement of operations, please see the "summary
production and price data" table at the end of this press release.
The Company's cash flow from operating activities (GAAP) for the nine
months ended September 30, 2009 was $232.1 million, as compared to
$319.4 million for the nine months ended September 30, 2008. Cash flow
from operating activities for the nine months ended September 30, 2009,
adjusted for settlements received (paid) on derivatives not designated
as hedges (non-GAAP) was $309.7 million, which is a 7% increase over the
comparable period of 2008, which totaled $290.2 million. For a
description of the use of cash flow from operating activities adjusted
for settlements received (paid) on derivatives not designated as hedges
(non-GAAP), please see footnote 1 above. For a reconciliation of cash
flow from operating activities (GAAP) to cash flow from operating
activities adjusted for settlements received (paid) on derivatives not
designated as hedges (non-GAAP) for the nine month periods ended
September 30, 2009 and 2008, please refer to the attached tables.
The Company recorded income tax expense of $21.8 million and
$91.0 million for the three months ended September 30, 2009 and 2008,
respectively. The effective income tax rate for the three months ended
September 30, 2009 and 2008 was 52.5% and 39.1%, respectively. At
September 30, 2009, the Company estimates its annual effective tax rate
to be approximately 31.0% and at June 30, 2009, the Company estimated
its annual effective tax rate to be 42.1%. The Company's estimates
involve assumptions that the Company believes to be reasonable at the
time of the estimation. The three months ended September 30, 2009
includes approximately $8.9 million of tax expense associated with the
effects of the change in the June 30, 2009 and the September 30, 2009
estimated annual effective tax rates.
In October 2009, the Company's credit facility borrowing base was
reaffirmed at $955.9 million during its semi-annual redetermination
process. As of September 30, 2009, the Company had $350 million of debt
outstanding under its credit facility and $300 million of senior
unsecured notes due 2017. The Company currently has over $600 million of
availability under its credit facility.
Operations
For the nine months ended September 30, 2009, the Company commenced the
drilling of or participated in a total of 240 gross wells (212
operated), of which 186 had been completed as producers, 52 of which
were in progress and two of which were unsuccessful at September 30,
2009. Currently, the Company is operating sixteen drilling rigs, all in
the Permian Basin; seven of these rigs are drilling Yeso wells in the
New Mexico Permian, eight of these rigs are drilling Wolfberry wells in
the Texas Permian, and one rig is drilling Lower Abo wells in New Mexico.
New Mexico Permian
For three months ended September 30, 2009, the Company commenced the
drilling of 55 gross wells (51 operated), with a 100% success rate on
the 28 wells that had been completed by September 30, 2009.
Texas Permian
For three months ended September 30, 2009, the Company commenced the
drilling of 29 gross wells (all operated), with a 100% success rate on
the eight wells that had been completed by September 30, 2009.
Lower Abo and Bakken Oil Plays
In early July, the Company reinitiated its operated drilling program in
the Lower Abo oil play and during the three months ended September 30,
2009, the Company commenced the drilling of five gross wells (two
operated) Lower Abo wells with a 100% success rate on the two wells that
had been completed by September 30, 2009. The Company currently plans to
keep one rig running in this play for the remainder of 2009. During the
third quarter and into the fourth quarter of 2009, the Company has
continued to add to its Lower Abo acreage position and as of mid-October
the Company's acreage position in the Lower Abo oil play totaled 52,634
gross (42,625 net) acres.
For three months ended September 30, 2009, the Company participated in
the drilling of four gross non-operated Bakken wells with one well
successfully completed, and three in progress, at September 30, 2009. In
total, the Company has participated as a non-operator in 38 Bakken wells
in North Dakota.
2010 Capital Budget
On November 5, 2009, Concho's Board of Directors approved a capital
budget for 2010 of approximately $500 million. This budget contemplates
a continuation in 2010 of the Company's projected year-end 2009 drilling
activity, including operating seventeen rigs (seven on the New Mexico
Permian Yeso, nine in the Wolfberry play and one in the Lower Abo
Horizontal oil play), and participation as a non-operator in the
Westburg and Sanish Bay areas of the North Dakota Bakken oil play. The
Company currently estimates that approximately 90% of this budget will
be funded with internally generated after tax cash flow assuming (i) a
NYMEX crude oil price of $70 per barrel and a NYMEX natural gas price of
$4 per thousand cubic feet of natural gas ("Mcf" ) for the Company's
unhedged production, and (ii) that the Company achieves the lower end of
its 2010 production guidance. The Company has not assumed any reduction
or increase in drilling and completion costs from their current levels.
The Company intends to aggressively monitor both the direction of
commodity prices and the costs of goods and services and may adjust its
capital budget, and resultant estimated production and cash flows, as
conditions warrant.
Of the approximately $440 million dedicated to the Company's two core
areas, approximately $290 million will be dedicated to drilling and
recompletions projects on the Company's New Mexico Permian assets and
approximately $100 million will be dedicated to drilling and
recompletion projects on its Texas Permian assets (primarily in the
Wolfberry play). On its New Mexico Permian assets, the Company plans to
drill approximately 200 Yeso combination wells and deepen seventeen
existing Paddock wells to the Blinebry interval. On its Texas Permian
assets, the Company plans to drill approximately 225 Wolfberry wells.
The remaining $50 million of capital dedicated to the Company's core
areas will be allocated between leasehold and G&G ($20 million) and
maintenance ($30 million).
The Company has allocated approximately $30 million to each of the
Bakken and Lower Abo oil plays. In the Lower Abo play, the Company plans
to drill or participate in the drilling of approximately fifteen gross
(eight net) wells, and in the Bakken oil play in North Dakota, the
Company expects to participate in the drilling of 32 gross (six net)
wells.
2010 Financial and Operational Guidance
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Production
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Oil equivalent (MMBoe)
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12.7 -13.2
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Oil (MMBbls)
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8.5 - 8.8
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Natural gas (Bcf)
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25.1 - 26.4
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Price differentials to NYMEX:
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(excluding the effects of hedging)
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Oil (Bbl)
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93 - 95%
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Natural gas (Mcf)
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105 - 120%
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Operating costs and expenses:
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Lease operating expense
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Direct lease operating expense ($/Bbl)
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$5.75 - $6.25
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Oil & gas taxes (% of oil and gas revenue)
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8.0%
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G&A expense
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Recurring cash ($/Bbl)
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$3.40 - $3.60
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Non-recurring Henry bonus ($/Bbl)
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$0.40 - $0.50
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Non-cash stock-based compensation ($/Bbl)
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$0.80 - $0.90
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Exploration, abandonments and G&G ($/Bbl)
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$1.90 - $2.10
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Interest rate
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$300 million bond issue
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8.625%
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$300 million LIBOR fixed
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1.90% + (200 - 250 bps)
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Remainder of debt
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LIBOR + (200 - 250 bps)
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Income taxes
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40%
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Percent deferred of total taxes
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65 - 75%
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Capital expenditures ($ in millions)
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Approximately $500
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Derivative Update
During the third quarter and early into the fourth quarter of 2009, the
Company continued to add to its derivative positions. For the remainder
of 2009, the Company has 1.2 MMBbls of oil and 2.4 Bcf of natural gas
hedged. For 2010, the Company currently has 4.5 MMBbls of oil and 14.3
Bcf of natural gas hedged. Please refer to the attached tables for
more detailed information about the Company's current hedge position.
Recent Developments
The Company also announced today that it has expanded the size of its
Board of Directors from seven to eight directors and has appointed Mark
B. Puckett to fill the newly-created vacancy. Mr. Puckett began his
career at Chevron in 1973 and retired in 2008. During his tenure at
Chevron, Mr. Puckett held a variety of positions of increasing
responsibility in Chevron's upstream operations before ultimately
retiring as the President of Chevron's Energy Technology Company, where
he was responsible for managing the company's technology resources
across all business segments. In addition, Mr. Puckett served on
Chevron's management committee from 1997 until his retirement and served
on Chevron's upstream and gas leadership team from 2001 until his
retirement. He is a member of the Society of Petroleum Engineers and the
Dean's Advisory Council, College of Engineering at Texas A&M University.
Mr. Puckett earned a bachelor's degree in civil engineering from Texas
A&M University.
Conference Call Information
The Company will host a conference call on Friday, November 6, 2009 at
9:00 a.m. Central Time to discuss third quarter 2009 financial and
operating results and 2010 capital budget details and guidance.
Interested parties may listen to the conference call via the Company's
website at http://www.conchoresources.com
or by dialing 866-700-6979 (passcode: 12614812). A replay of the
conference call will be available on the Company's website or by dialing
888-286-8010 (passcode: 22751170).
Forward-Looking Statements and Cautionary Statements
The foregoing contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. All statements, other than statements
of historical facts, included in this press release that address
activities, events or developments that the Company expects, believes or
anticipates will or may occur in the future are forward-looking
statements. Without limiting the generality of the foregoing,
forward-looking statements contained in this press release specifically
include the expectations of plans, strategies, objectives and
anticipated financial and operating results of the Company, including
the Company's drilling program, production, derivatives activities,
capital expenditure levels and other guidance included in this press
release. These statements are based on certain assumptions made by the
Company based on management's experience and perception of historical
trends, current conditions, anticipated future developments and other
factors believed to be appropriate. Such statements are subject to a
number of assumptions, risks and uncertainties, many of which are beyond
the control of the Company, which may cause actual results to differ
materially from those implied or expressed by the forward-looking
statements. These include risks relating to financial performance and
results, prices and demand for oil and natural gas, availability of
drilling equipment and personnel, availability of sufficient capital to
execute the Company's business plan, its ability to replace reserves and
efficiently develop and exploit its current reserves and other important
factors that could cause actual results to differ materially from those
projected as described in the Company's reports filed with the
Securities and Exchange Commission.
Any forward-looking statement speaks only as of the date on which such
statement is made and the Company undertakes no obligation to correct or
update any forward-looking statement, whether as a result of new
information, future events or otherwise, except as required by
applicable law.
About Concho Resources Inc.
Concho Resources Inc. is an independent oil and natural gas company
engaged in the acquisition, development, exploitation and exploration of
oil and natural gas properties. The Company's operations are focused in
the Permian Basin of Southeast New Mexico and West Texas. In addition,
the Company is involved in a number of emerging plays. For more
information, visit Concho's website at www.conchoresources.com.
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Concho Resources Inc.
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Consolidated Balance Sheets
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Unaudited
|
|
|
|
|
|
|
|
|
|
September 30,
|
|
December 31,
|
|
(in thousands, except share and per share data)
|
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2009
|
|
2008
|
|
Assets
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
15,695
|
|
|
$
|
17,752
|
|
|
Accounts receivable, net of allowance for doubtful accounts:
|
|
|
|
|
|
Oil and natural gas
|
|
|
67,021
|
|
|
|
48,793
|
|
|
Joint operations and other
|
|
|
72,402
|
|
|
|
92,833
|
|
|
Related parties
|
|
|
138
|
|
|
|
314
|
|
|
Derivative instruments
|
|
|
9,405
|
|
|
|
113,149
|
|
|
Deferred income taxes
|
|
|
5,800
|
|
|
|
-
|
|
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Prepaid costs and other
|
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8,462
|
|
|
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5,942
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|
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Total current assets
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178,923
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278,783
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Property and equipment, at cost:
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Oil and natural gas properties, successful efforts method
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2,980,268
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|
|
|
2,693,574
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Accumulated depletion
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(468,247
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)
|
|
|
(306,990
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)
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Total oil and natural gas properties, net
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|
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2,512,021
|
|
|
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2,386,584
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Other property and equipment, net
|
|
|
16,151
|
|
|
|
14,820
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Total property and equipment, net
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|
|
2,528,172
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|
|
|
2,401,404
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Deferred loan costs, net
|
|
|
21,982
|
|
|
|
15,701
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|
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Inventory
|
|
|
24,351
|
|
|
|
19,956
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|
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Intangible asset, net - operating rights
|
|
|
36,909
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|
|
|
37,768
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|
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Noncurrent derivative instruments
|
|
|
30,727
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|
|
|
61,157
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|
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Other assets
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|
|
462
|
|
|
|
434
|
|
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Total assets
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|
$
|
2,821,526
|
|
|
$
|
2,815,203
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|
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Liabilities and Stockholders' Equity
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
Accounts payable:
|
|
|
|
|
|
Trade
|
|
$
|
12,010
|
|
|
$
|
7,462
|
|
|
Related parties
|
|
|
793
|
|
|
|
312
|
|
|
Other current liabilities:
|
|
|
|
|
|
Bank overdrafts
|
|
|
2,810
|
|
|
|
9,434
|
|
|
Revenue payable
|
|
|
40,532
|
|
|
|
22,286
|
|
|
Accrued and prepaid drilling costs
|
|
|
120,726
|
|
|
|
154,196
|
|
|
Derivative instruments
|
|
|
23,158
|
|
|
|
1,866
|
|
|
Deferred income taxes
|
|
|
-
|
|
|
|
37,205
|
|
|
Other current liabilities
|
|
|
42,204
|
|
|
|
38,057
|
|
|
Total current liabilities
|
|
|
242,233
|
|
|
|
270,818
|
|
|
Long-term debt
|
|
|
645,747
|
|
|
|
630,000
|
|
|
Noncurrent derivative instruments
|
|
|
16,559
|
|
|
|
-
|
|
|
Deferred income taxes
|
|
|
591,029
|
|
|
|
573,763
|
|
|
Asset retirement obligations and other long-term liabilities
|
|
|
13,258
|
|
|
|
15,468
|
|
|
Commitments and contingencies
|
|
|
|
|
|
Stockholders' equity:
|
|
|
|
|
|
Common stock, $0.001 par value; 300,000,000 authorized;
85,605,502
and 84,828,824 shares issued at
September 30, 2009 and
December 31, 2008, respectively
|
|
|
86
|
|
|
|
85
|
|
|
Additional paid-in capital
|
|
|
1,023,543
|
|
|
|
1,009,025
|
|
|
Retained earnings
|
|
|
289,488
|
|
|
|
316,169
|
|
|
Treasury stock, at cost; 12,380 and 3,142 shares at
September
30, 2009 and December 31, 2008, respectively
|
|
|
(417
|
)
|
|
|
(125
|
)
|
|
Total stockholders' equity
|
|
|
1,312,700
|
|
|
|
1,325,154
|
|
|
Total liabilities and stockholders' equity
|
|
$
|
2,821,526
|
|
|
$
|
2,815,203
|
|
|
Concho Resources Inc.
|
|
Consolidated Statements of Operations
|
|
Unaudited
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
|
(in thousands, except per share amounts)
|
|
2009
|
|
2008
|
|
2009
|
|
2008
|
|
Operating revenues:
|
|
|
|
|
|
|
|
|
|
Oil sales
|
|
$
|
121,301
|
|
|
$
|
130,600
|
|
|
$
|
287,786
|
|
|
$
|
301,826
|
|
|
Natural gas sales
|
|
|
32,193
|
|
|
|
39,857
|
|
|
|
79,042
|
|
|
|
112,725
|
|
|
Total operating revenues
|
|
|
153,494
|
|
|
|
170,457
|
|
|
|
366,828
|
|
|
|
414,551
|
|
|
Operating costs and expenses:
|
|
|
|
|
|
|
|
|
|
Oil and natural gas production
|
|
|
25,439
|
|
|
|
27,041
|
|
|
|
76,022
|
|
|
|
65,915
|
|
|
Exploration and abandonments
|
|
|
2,776
|
|
|
|
16,824
|
|
|
|
10,195
|
|
|
|
20,288
|
|
|
Depreciation, depletion and amortization
|
|
|
54,835
|
|
|
|
32,528
|
|
|
|
157,985
|
|
|
|
75,822
|
|
|
Accretion of discount on asset retirement obligations
|
|
|
220
|
|
|
|
270
|
|
|
|
799
|
|
|
|
571
|
|
|
Impairments of long-lived assets
|
|
|
1,131
|
|
|
|
2,758
|
|
|
|
9,686
|
|
|
|
2,827
|
|
|
General and administrative (including non-cash stock-based
compensation of $2,548 and $1,925 for the three months ended
September 30, 2009 and 2008, respectively, and $6,661 and $4,954
for the nine months ended September 30, 2009 and 2008,
respectively)
|
|
|
12,715
|
|
|
|
10,778
|
|
|
|
38,633
|
|
|
|
27,044
|
|
|
Bad debt expense
|
|
|
-
|
|
|
|
1,106
|
|
|
|
-
|
|
|
|
2,905
|
|
|
Ineffective portion of cash flow hedges
|
|
|
-
|
|
|
|
(416
|
)
|
|
|
-
|
|
|
|
(1,336
|
)
|
|
(Gain) loss on derivatives not designated as hedges
|
|
|
7,783
|
|
|
|
(163,312
|
)
|
|
|
94,435
|
|
|
|
(43,678
|
)
|
|
Total operating costs and expenses
|
|
|
104,899
|
|
|
|
(72,423
|
)
|
|
|
387,755
|
|
|
|
150,358
|
|
|
Income (loss) from operations
|
|
|
48,595
|
|
|
|
242,880
|
|
|
|
(20,927
|
)
|
|
|
264,193
|
|
|
Other income (expense):
|
|
|
|
|
|
|
|
|
|
Interest expense
|
|
|
(6,809
|
)
|
|
|
(10,255
|
)
|
|
|
(17,379
|
)
|
|
|
(19,755
|
)
|
|
Other, net
|
|
|
(200
|
)
|
|
|
334
|
|
|
|
(348
|
)
|
|
|
1,665
|
|
|
Total other expense
|
|
|
(7,009
|
)
|
|
|
(9,921
|
)
|
|
|
(17,727
|
)
|
|
|
(18,090
|
)
|
|
Income (loss) before income taxes
|
|
|
41,586
|
|
|
|
232,959
|
|
|
|
(38,654
|
)
|
|
|
246,103
|
|
|
Income tax (expense) benefit
|
|
|
(21,824
|
)
|
|
|
(91,031
|
)
|
|
|
11,973
|
|
|
|
(96,230
|
)
|
|
Net income (loss)
|
|
$
|
19,762
|
|
|
$
|
141,928
|
|
|
$
|
(26,681
|
)
|
|
$
|
149,873
|
|
|
Basic earnings per share:
|
|
|
|
|
|
|
|
|
|
Net income (loss) per share
|
|
$
|
0.23
|
|
|
$
|
1.75
|
|
|
$
|
(0.31
|
)
|
|
$
|
1.93
|
|
|
Weighted average shares used in basic earnings per share
|
|
|
85,061
|
|
|
|
81,288
|
|
|
|
84,798
|
|
|
|
77,489
|
|
|
Diluted earnings per share:
|
|
|
|
|
|
|
|
|
|
Net income (loss) per share
|
|
$
|
0.23
|
|
|
$
|
1.72
|
|
|
$
|
(0.31
|
)
|
|
$
|
1.90
|
|
|
Weighted average shares used in diluted earnings per share
|
|
|
86,088
|
|
|
|
82,724
|
|
|
|
84,798
|
|
|
|
78,945
|
|
|
Concho Resources Inc.
|
|
Consolidated Statements of Cash Flows
|
|
Unaudited
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30,
|
|
(in thousands)
|
|
2009
|
|
2008
|
|
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
Net income (loss)
|
|
$
|
(26,681
|
)
|
|
$
|
149,873
|
|
|
Adjustments to reconcile net income (loss) to net cash provided by
operating activities:
|
|
|
|
|
|
Depreciation, depletion and amortization
|
|
|
157,985
|
|
|
|
75,822
|
|
|
Impairments of long-lived assets
|
|
|
9,686
|
|
|
|
2,827
|
|
|
Accretion of discount on asset retirement obligations
|
|
|
799
|
|
|
|
571
|
|
|
Exploration expense, including dry holes
|
|
|
6,950
|
|
|
|
17,860
|
|
|
Non-cash compensation expense
|
|
|
6,661
|
|
|
|
4,954
|
|
|
Bad debt expense
|
|
|
-
|
|
|
|
2,905
|
|
|
Deferred income taxes
|
|
|
(21,840
|
)
|
|
|
86,908
|
|
|
(Gain) loss on sale of assets
|
|
|
147
|
|
|
|
(777
|
)
|
|
Ineffective portion of cash flow hedges
|
|
|
-
|
|
|
|
(1,336
|
)
|
|
(Gain) loss on derivatives not designated as hedges
|
|
|
94,435
|
|
|
|
(43,678
|
)
|
|
Dedesignated cash flow hedges reclassified from accumulated other
comprehensive income
|
|
|
-
|
|
|
|
260
|
|
|
Other non-cash items
|
|
|
2,656
|
|
|
|
2,749
|
|
|
Changes in operating assets and liabilities, net of acquisitions:
|
|
|
|
|
|
Accounts receivable
|
|
|
(10,367
|
)
|
|
|
26,209
|
|
|
Prepaid costs and other
|
|
|
(2,519
|
)
|
|
|
(1,035
|
)
|
|
Inventory
|
|
|
(3,979
|
)
|
|
|
(14,985
|
)
|
|
Accounts payable
|
|
|
5,029
|
|
|
|
(12,472
|
)
|
|
Revenue payable
|
|
|
17,581
|
|
|
|
6,982
|
|
|
Other current liabilities
|
|
|
(4,465
|
)
|
|
|
15,763
|
|
|
Net cash provided by operating activities
|
|
|
232,078
|
|
|
|
319,400
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
Capital expenditures on oil and natural gas properties
|
|
|
(316,756
|
)
|
|
|
(213,666
|
)
|
|
Acquisition of oil and gas properties, businesses and other assets
|
|
|
-
|
|
|
|
(586,925
|
)
|
|
Additions to other property and equipment
|
|
|
(3,716
|
)
|
|
|
(6,711
|
)
|
|
Proceeds from the sale of oil and natural gas properties and other
assets
|
|
|
1,004
|
|
|
|
1,034
|
|
|
Settlements received (paid) on derivatives not designated as hedges
|
|
|
77,590
|
|
|
|
(29,170
|
)
|
|
Net cash used in investing activities
|
|
|
(241,878
|
)
|
|
|
(835,438
|
)
|
|
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
Proceeds from issuance of long-term debt
|
|
|
672,650
|
|
|
|
767,800
|
|
|
Payments of long-term debt
|
|
|
(656,916
|
)
|
|
|
(460,700
|
)
|
|
Exercise of stock options
|
|
|
4,501
|
|
|
|
3,861
|
|
|
Excess tax benefit from stock-based compensation
|
|
|
3,357
|
|
|
|
2,884
|
|
|
Net proceeds from issuance of common stock
|
|
|
-
|
|
|
|
242,426
|
|
|
Proceeds from repayment of employee notes
|
|
|
-
|
|
|
|
333
|
|
|
Payments for loan costs
|
|
|
(8,933
|
)
|
|
|
(15,541
|
)
|
|
Purchase of treasury stock
|
|
|
(292
|
)
|
|
|
(125
|
)
|
|
Bank overdrafts
|
|
|
(6,624
|
)
|
|
|
(954
|
)
|
|
Net cash provided by financing activities
|
|
|
7,743
|
|
|
|
539,984
|
|
|
Net increase (decrease) in cash and cash equivalents
|
|
|
(2,057
|
)
|
|
|
23,946
|
|
|
Cash and cash equivalents at beginning of period
|
|
|
17,752
|
|
|
|
30,424
|
|
|
Cash and cash equivalents at end of period
|
|
$
|
15,695
|
|
|
$
|
54,370
|
|
|
SUPPLEMENTAL CASH FLOWS:
|
|
|
|
|
|
Cash paid for interest and fees, net of $33 and $1,090 capitalized
interest
|
|
$
|
13,291
|
|
|
$
|
16,164
|
|
|
Cash paid for income taxes
|
|
$
|
5,598
|
|
|
$
|
5,964
|
|
|
NON-CASH INVESTING ACTIVITIES:
|
|
|
|
|
|
Deferred tax effect of acquired oil and gas properties
|
|
$
|
(835
|
)
|
|
$
|
200,786
|
|
|
Concho Resources Inc.
|
|
Summary Production and Price Data
|
|
Unaudited
|
|
|
|
|
|
|
|
|
|
|
|
The following table presents selected operating information of
Concho Resources Inc. for the periods indicated:
|
|
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
|
(in thousands, except price and daily volume data)
|
|
2009
|
|
2008
|
|
2009
|
|
2008
|
|
|
|
|
|
|
|
|
|
|
|
Net production volumes:
|
|
|
|
|
|
|
|
|
|
Oil (MBbl)
|
|
|
1,912
|
|
|
|
1,247
|
|
|
|
5,430
|
|
|
|
3,033
|
|
|
Natural gas (MMcf)
|
|
|
5,753
|
|
|
|
3,944
|
|
|
|
16,122
|
|
|
|
10,395
|
|
|
Total (MBoe)
|
|
|
2,871
|
|
|
|
1,904
|
|
|
|
8,117
|
|
|
|
4,766
|
|
|
|
|
|
|
|
|
|
|
|
|
Average daily production volumes:
|
|
|
|
|
|
|
|
|
|
Oil (Bbl)
|
|
|
20,783
|
|
|
|
13,554
|
|
|
|
19,890
|
|
|
|
11,069
|
|
|
Natural gas (Mcf)
|
|
|
62,533
|
|
|
|
42,870
|
|
|
|
59,055
|
|
|
|
37,938
|
|
|
Total (Boe)
|
|
|
31,205
|
|
|
|
20,699
|
|
|
|
29,733
|
|
|
|
17,392
|
|
|
|
|
|
|
|
|
|
|
|
|
Average prices:
|
|
|
|
|
|
|
|
|
|
Oil, without hedges (Bbl)
|
|
$
|
63.44
|
|
|
$
|
114.44
|
|
|
$
|
53.00
|
|
|
$
|
110.29
|
|
|
Oil, with hedges (Bbl) (a)
|
|
$
|
70.75
|
|
|
$
|
95.24
|
|
|
$
|
65.96
|
|
|
$
|
90.35
|
|
|
Natural gas, without hedges (Mcf)
|
|
$
|
5.60
|
|
|
$
|
10.12
|
|
|
$
|
4.90
|
|
|
$
|
10.87
|
|
|
Natural gas, with hedges (Mcf) (a)
|
|
$
|
6.19
|
|
|
$
|
9.87
|
|
|
$
|
5.48
|
|
|
$
|
10.71
|
|
|
Total, without hedges (Boe)
|
|
$
|
53.46
|
|
|
$
|
95.91
|
|
|
$
|
45.19
|
|
|
$
|
93.89
|
|
|
Total, with hedges (Boe) (a)
|
|
$
|
59.51
|
|
|
$
|
82.81
|
|
|
$
|
55.00
|
|
|
$
|
80.86
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Includes the effect of (i) commodity derivatives designated as
hedges and reported in oil and natural gas sales and (ii) includes
the cash payments/receipts on commodity derivatives not designated
as hedges and reported in operating costs and expenses. The
following table reflects the amounts of cash payments/receipts on
commodity derivatives not designated as hedges that were included
in computing average prices with hedges and reconciles to the
amount in gain (loss) on derivatives not designated as hedges as
reported in the statement of operations:
|
|
|
|
|
|
|
|
|
|
|
|
Oil and natural gas sales:
|
|
|
|
|
|
|
|
|
|
Cash payments on oil derivatives
|
|
$
|
-
|
|
|
$
|
(12,111
|
)
|
|
$
|
-
|
|
|
$
|
(32,684
|
)
|
|
Dedesignated natural gas cash flow hedges reclassified from
accumulated other comprehensive income
|
|
|
-
|
|
|
|
(38
|
)
|
|
|
-
|
|
|
|
(260
|
)
|
|
Total effect on oil and natural gas sales
|
|
$
|
-
|
|
|
$
|
(12,149
|
)
|
|
$
|
-
|
|
|
$
|
(32,944
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Gain (loss) on derivatives not designated as hedges:
|
|
|
|
|
|
|
|
|
|
Cash (payments) receipts on oil derivatives
|
|
$
|
13,971
|
|
|
$
|
(11,837
|
)
|
|
$
|
70,383
|
|
|
$
|
(27,802
|
)
|
|
Cash (payments) receipts on gas derivatives
|
|
|
3,395
|
|
|
|
(946
|
)
|
|
|
9,227
|
|
|
|
(1,368
|
)
|
|
Cash (payments) receipts on interest rate derivatives
|
|
|
(1,241
|
)
|
|
|
-
|
|
|
|
(2,020
|
)
|
|
|
-
|
|
|
Unrealized mark-to-market gain (loss) on commodity and interest rate
derivatives
|
|
|
(23,908
|
)
|
|
|
176,095
|
|
|
|
(172,025
|
)
|
|
|
72,848
|
|
|
Gain (loss) on derivatives not designated as hedges
|
|
$
|
(7,783
|
)
|
|
$
|
163,312
|
|
|
$
|
(94,435
|
)
|
|
$
|
43,678
|
|
|
|
|
The presentation of average prices with hedges is a non-GAAP
measure as a result of including the cash payments/receipts on
commodity derivatives that are presented in gain (loss) on
derivatives not designated as hedges in the statements of
operations. This presentation of average prices with hedges is a
means by which to reflect the actual cash performance of our
commodity derivatives for the respective periods and presents oil
and gas prices with hedges in a manner consistent with the
presentation generally used by the investment community.
|
Concho Resources Inc.
Supplemental Non-GAAP Financial Measures
Unaudited
EBITDAX (as defined below) is presented herein, and reconciled from the
generally accepted accounting principle ("GAAP" ) measure of net income
because of its wide acceptance by the investment community as a
financial indicator of a company's ability to internally fund
exploration and development activities.
The Company defines EBITDAX as net income (loss), plus (1) exploration
and abandonments expense, (2) depreciation, depletion and amortization
expense, (3) accretion expense, (4) impairments of long-lived assets,
(5) non-cash stock-based compensation expense, (6) ineffective portion
of cash flow hedges and unrealized (gain) loss on derivatives not
designated as hedges, (7) interest expense, (8) bad debt expense and (9)
federal and state income taxes. EBITDAX is not a measure of net income
(loss) or cash flow as determined by GAAP.
The Company's EBITDAX measure provides additional information which may
be used to better understand its operations. EBITDAX is one of several
metrics that the Company uses as a supplemental financial measurement in
the evaluation of its business and should not be considered as an
alternative to, or more meaningful than, net income, as an indicator of
its operating performance. Certain items excluded from EBITDAX are
significant components in understanding and assessing a company's
financial performance, such as a company's cost of capital and tax
structure, as well as the historic cost of depreciable assets, none of
which are components of EBITDAX. EBITDAX as used by us may not be
comparable to similarly titled measures reported by other companies. The
Company believes that EBITDAX is a widely followed measure of operating
performance and is one of many metrics used by its management team and
by other users of its consolidated financial statements. For example,
EBITDAX can be used to assess the Company's operating performance and
return on capital in comparison to other independent exploration and
production companies without regard to financial or capital structure,
and to assess the financial performance of its assets and the company
without regard to capital structure or historical cost basis.
The following table provides a reconciliation of net income (loss) to
EBITDAX:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
|
(in thousands)
|
|
2009
|
|
2008
|
|
2009
|
|
2008
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
$
|
19,762
|
|
$
|
141,928
|
|
|
$
|
(26,681
|
)
|
|
$
|
149,873
|
|
|
Exploration and abandonments
|
|
|
2,776
|
|
|
16,824
|
|
|
|
10,195
|
|
|
|
20,288
|
|
|
Depreciation, depletion and amortization
|
|
|
54,835
|
|
|
32,528
|
|
|
|
157,985
|
|
|
|
75,822
|
|
|
Accretion of discount on asset retirement obligations
|
|
|
220
|
|
|
270
|
|
|
|
799
|
|
|
|
571
|
|
|
Impairments of long-lived assets
|
|
|
1,131
|
|
|
2,758
|
|
|
|
9,686
|
|
|
|
2,827
|
|
|
Non-cash stock-based compensation
|
|
|
2,548
|
|
|
1,925
|
|
|
|
6,661
|
|
|
|
4,954
|
|
|
Bad debt expense
|
|
|
-
|
|
|
1,106
|
|
|
|
-
|
|
|
|
2,905
|
|
|
Ineffective portion of cash flow hedges
|
|
|
-
|
|
|
(416
|
)
|
|
|
-
|
|
|
|
(1,336
|
)
|
|
Unrealized (gain) loss on derivatives not designated as hedges
|
|
|
23,908
|
|
|
(176,095
|
)
|
|
|
172,025
|
|
|
|
(72,848
|
)
|
|
Interest expense
|
|
|
6,809
|
|
|
10,255
|
|
|
|
17,379
|
|
|
|
19,755
|
|
|
Income tax expense (benefit)
|
|
|
21,824
|
|
|
91,031
|
|
|
|
(11,973
|
)
|
|
|
96,230
|
|
|
EBITDAX
|
|
$
|
133,813
|
|
$
|
122,114
|
|
|
$
|
336,076
|
|
|
$
|
299,041
|
|
The following tables provide information that the Company believes may
be useful to investors who follow the practice of some industry analysts
who adjust reported company earnings and cash flow from operating
activities to match realizations to production settlement months and
make other adjustments to exclude certain non-cash items. The following
table provides a reconciliation of net income (loss) (GAAP) to adjusted
net income (non-GAAP).
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
|
(in thousands)
|
|
2009
|
|
2008
|
|
2009
|
|
2008
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) - as reported
|
|
$
|
19,762
|
|
|
$
|
141,928
|
|
|
$
|
(26,681
|
)
|
|
$
|
149,873
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments for certain non-cash items:
|
|
|
|
|
|
|
|
|
|
Unrealized mark-to-market (gain) loss on commodity and interest rate
derivatives
|
|
|
23,908
|
|
|
|
(176,095
|
)
|
|
|
172,025
|
|
|
|
(72,848
|
)
|
|
Impairments of long-lived assets
|
|
|
1,131
|
|
|
|
2,758
|
|
|
|
9,686
|
|
|
|
2,827
|
|
|
Leasehold abandonments
|
|
|
182
|
|
|
|
13,934
|
|
|
|
4,610
|
|
|
|
15,082
|
|
|
Tax impact
|
|
|
(13,236
|
)
|
|
|
62,288
|
|
|
|
(57,713
|
)
|
|
|
21,482
|
|
|
Adjusted net income
|
|
$
|
31,747
|
|
|
$
|
44,813
|
|
|
$
|
101,927
|
|
|
$
|
116,416
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted basic earnings per share:
|
|
|
|
|
|
|
|
|
|
Adjusted net income per share
|
|
$
|
0.37
|
|
|
$
|
0.55
|
|
|
$
|
1.20
|
|
|
$
|
1.50
|
|
|
Weighted average shares used in adjusted basic earnings per share
|
|
|
85,061
|
|
|
|
81,288
|
|
|
|
84,798
|
|
|
|
77,489
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted diluted earnings per share:
|
|
|
|
|
|
|
|
|
|
Adjusted net income per share
|
|
$
|
0.37
|
|
|
$
|
0.54
|
|
|
$
|
1.19
|
|
|
$
|
1.47
|
|
|
Weighted average shares used in adjusted diluted earnings per share
|
|
|
86,088
|
|
|
|
82,724
|
|
|
|
85,905
|
|
|
|
78,945
|
|
The following table provides a reconciliation of cash flow from
operating activities (GAAP) to cash flow from operating activities
adjusted for settlements received (paid) on derivatives not designated
as hedges (non-GAAP).
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30,
|
|
(in thousands)
|
|
2009
|
|
2008
|
|
|
|
|
|
|
|
Cash flows from operating activities
|
|
$
|
232,078
|
|
$
|
319,400
|
|
|
Settlements received (paid) on derivatives not designated as hedges1
|
|
|
77,590
|
|
|
(29,170
|
)
|
|
Cash flows from operating activities adjusted for settlements
received (paid) on derivatives not designated as hedges
|
|
$
|
309,668
|
|
$
|
290,230
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Amounts are presented in cash flows from investing
activities for GAAP purposes.
|
|
Concho Resources Inc.
|
|
Derivatives Information at November 5, 2009
|
|
Unaudited
|
|
|
|
The table below provides data associated with the Company's oil,
natural gas and interest rate derivatives at November 5, 2009. The
counterparties in its derivative instruments are Bank of America,
N.A., Bank of Nova Scotia, BNP Paribas, Calyon, Citibank, N.A.,
Compass Bank, JPMorgan Chase Bank, N.A., KeyBank, and Wells Fargo
Bank, N.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fourth Quarter
|
|
|
|
|
|
|
|
|
|
|
2009
|
|
2010
|
|
2011
|
|
2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil Swaps
|
|
|
|
|
|
|
|
|
|
|
Volume (Bbl)
|
|
|
1,028,473
|
|
|
|
4,488,746
|
|
|
|
3,158,746
|
|
|
|
504,000
|
|
|
|
NYMEX price (Bbl) (a)
|
|
$
|
72.31
|
|
|
$
|
69.74
|
|
|
$
|
77.53
|
|
|
$
|
127.80
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil Collars
|
|
|
|
|
|
|
|
|
|
|
Volume (Bbl)
|
|
|
192,000
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
NYMEX price (Bbl) (a)
|
|
|
|
|
|
|
|
|
|
|
Ceiling
|
|
$
|
134.60
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
Floor
|
|
$
|
120.00
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Natural Gas Swaps
|
|
|
|
|
|
|
|
|
|
|
Volume (MMBtu)
|
|
|
460,000
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
EPNG-PB price (MMBtu) (b)
|
|
$
|
8.44
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Natural Gas Swaps
|
|
|
|
|
|
|
|
|
|
|
Volume (MMBtu)
|
|
|
450,000
|
|
|
|
8,314,000
|
|
|
|
5,700,000
|
|
|
|
-
|
|
|
|
NYMEX price (MMBtu) (c)
|
|
|
4.66
|
|
|
|
6.12
|
|
|
|
6.98
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Natural Gas Collars
|
|
|
|
|
|
|
|
|
|
|
Volume (MMBtu)
|
|
|
1,500,000
|
|
|
|
6,000,000
|
|
|
|
1,500,000
|
|
|
|
-
|
|
|
|
NYMEX price (MMBtu) (c)
|
|
|
|
|
|
|
|
|
|
|
Ceiling
|
|
$
|
5.81
|
|
|
$
|
6.03
|
|
|
$
|
6.80
|
|
|
|
-
|
|
|
|
Floor
|
|
$
|
5.00
|
|
|
$
|
5.38
|
|
|
$
|
6.00
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Natural Gas Basis Swaps
|
|
|
|
|
|
|
|
|
|
|
Volume (MMBtu)
|
|
|
1,968,000
|
|
|
|
8,400,000
|
|
|
|
7,200,000
|
|
|
|
-
|
|
|
|
Price differential (MMBtu) (d)
|
|
$
|
1.03
|
|
|
$
|
0.85
|
|
|
$
|
0.79
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Rate Swap
|
|
|
|
|
|
|
|
|
|
|
Notional Amount
|
|
$
|
300,000,000
|
|
|
$
|
300,000,000
|
|
|
$
|
300,000,000
|
|
|
$
|
300,000,000
|
|
|
|
Annual Rate (e)
|
|
|
1.90
|
%
|
|
|
1.90
|
%
|
|
|
1.90
|
%
|
|
|
1.90
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) The index prices for the oil contracts are based on the
NYMEX-West Texas Intermediate monthly average futures price.
|
|
(b) The index price for the natural gas contract is based on the
Inside FERC-El Paso Permian Basin first-of-the-month spot price.
|
|
(c) The index prices for the natural gas contracts are based on the
NYMEX-Henry Hub last trading day of the month futures price.
|
|
(d) The basis differential between the El Paso Permian delivery
point and NYMEX-Henry Hub delivery point.
|
|
(e) The index rate is based on the one-month LIBOR.
|
Concho Resources Inc.
Jack Harper, 432-683-7443
Vice President
- Capital Markets and Business Development
Copyright © 2009, Business Wire, Inc., All rights reserved. Copyright © 2009, NewsBlaze, Daily NewsTags: Business wire, new mexico, texas
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